Cattle Outlook: Choice Beef Retail Price Runs Higher

The average price of choice beef at retail was $6.20 per pound during June. That was 11.9 cents higher than in May, 20.6 than in June 2015, and the highest monthly average price since March. The June average grocery store price for all fresh beef was $5.832 per pound.

The 5 area average price of for slaughter steers was $123.00/cwt during June. That as $7.20 lower than in May, $28.20 lower than in June 2015, and the lowest monthly average since August 2013.

USDA's July WASDE forecasts have U.S. beef production up 5.3% this year and up another 3.4% in 2017.

USDA weekly crop progress report said that 13% of U.S. pastures were in poor or very poor condition as of July 10. That is up 1 point from the week before and 4 points higher than a year ago.

Fed cattle sales volume was moderate this week. Through Thursday, the 5-area average price for slaughter steers sold on a live weight basis was $117.00/cwt, down $3.38 from last week's average and down $29.00 from a year ago. The 5-area dressed steer price averaged $187.42/cwt, down $3.24 from the week before and down $47.58 from a year ago.

This morning the choice boxed beef cutout value was $205.37/cwt, down $4.49 from the previous Friday and down $27.94 from a year ago. The select carcass cutout this morning was $193.24/cwt, down $3.73 from last week and down $36.44 compared to last year. The choice-select spread, $12.15/cwt this morning, remains large.

This week's cattle slaughter totaled only 594,000 head, up 16.5% from last week (which was low because of the Independence Day holiday) and up 9.6% from a year ago.

The average steer dressed weight for the week ending on July 2 was 868 pounds, up 4 pounds from the week before, down 7 pounds from a year ago, and below the year-ago level for the ninth consecutive week. Year-to-date, cattle slaughter is up 3.1% and beef production is up 3.8%

The August live cattle futures contract settled at $110.92/cwt today, down $1.30 for the week. October fed cattle settled at $109.85/cwt, down $2.47 from the previous Friday. The December contract ended the week at $111.45/cwt.

August feeder cattle futures ended the week at $139.57/cwt, down $3.88 from a week earlier. October feeder cattle closed the week down $4.10 at $137.37/cwt.